By FIL C. SIONIL
The Bureau of Treasury allowed the 91-day and 182-day Treasury bill rates to rise significantly on partial awards at yesterday’s auction, but rejected all tenders for 364-day bills.
The bellwether 91-day rate, which banks use as benchmark in pricing loans, averaged 7.616 percent compared with 6.435 percent previously. The auction committee accepted P1.83 billion of tenders totalling P2.255 billion against an offering of P3.5 billion.
The 182–day rate averaged 8.612 percent against the previous average of 7.834 percent, with the government accepting P1.15 billion of tenders reaching P1.695 billion. The offering was P2.5 billion.
Bids for the 364-day bills ranged from a low of 9.23 percent to as high as 9.75 percent compared with the previous average of 8.384 percent. Tenders totalled P2.352 billion against an offering of P2.0 billion.
“We’re just aligning (the 91-day and 182-day rates) with secondary market rates. For the one-year bills, however, the (offered) rates were very far from the swap market rate, which is below 9.0 percent,” National Treasurer Mina Fegueroa said after the auction.
The government decided to accept some of the tenders after fully rejecting bids at the March 1 auction.
The BTr has reduced the volume of its regular T-bill offerings to P8.0 billion from P11 billion, and has begun issuing 42–day T-bills worth P4.0 billion in each of the two auctions set for this month.
Due to the uncertainty in the political front, the cost of government borrowings have followed a rollercoaster ride since the start of 2004, from an average of 6.246 percent for the 91-day Tbills during the first auction for the year, then, dipping to 6.16 percent the following auction.
On February 2, the yield of the three-month bills inched-up again to 6.216 percent and finally to 6.435 percent on February 16, the last auction before the committee exercised its authority to reject off-tangent bid-rates offered that lasted for almost a month.
“Hopefully, we’ve seen the worse. I hope no other uncertainty could be priced-in at those levels,” Figueroa said.
In spite the uptick in the T-bill rates, the national treasurer announced the government will proceed with the issuance of the cash-management bills (CM Bills) every other week worth P4 billion.
Aside from the flotation of the CM Bills, the auction committee will exercise its option to open the tap facility “depending on the demand of the market,” Figueroa said.
